Decenija potpunog ciljanja inflacije u Srbiji

Abstract

The aim of this paper is to describe the main postulates of the inflation targeting regime in Serbia and to explain policy responses against the background of domestic and global conditions in which the regime has been implemented. The paper also dwells on the debates about the inflation targeting as a theoretical concept and its 'upgrades' arising from the practice. The paper focuses on assessing the performance of this regime after a decade of full-fledged implementation in Serbia. Serbia may offer responses to policymakers, as a good example of a small and open economy with a legacy of high euroisation, which reduced its external and internal imbalances, stabilised prices and the exchange market, and managed to keep its financial system sound and improve the overall growth prospects. Timely responses, consistent approach, open-mindedness and readiness to use all available instruments, in full coordination with other policies, are the key elements on which the National Bank of Serbia founded the inflation targeting regime and upgraded it along the way, especially in the second period of its implementation. Today, we are speaking about Serbia as a country with low inflation, anchored inflation expectations and credible monetary policy. In assessing the adequacy of this regime for our economy, based on the results measured by price and financial stability, it may be concluded that for Serbia there is no alternative to the inflation targeting regime. Working through all transmission channels, monetary policy gave the key contribution to more favourable business and investment conditions and to sustainable economic growth. On the whole, the inflation targeting regime was an important and inextricable part of the overall economic policy, which laid the groundwork for a better economic outlook for Serbia.